Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Finchley. Inevitably, the term of lease remaining shortens as time goes by. This is often overlooked and only raises itself as an issue when the residence needs to be disposed of or re-mortgaged. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension. Eligible leaseholders in Finchley have the right to extend the lease for an additional ninety years under statute. Do give careful attention before putting off your Finchley lease extension. Putting off that expense now only increases the price you will ultimately incur for a lease extension
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you increased control over the value of your Finchley leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Freddie owned a conversion apartment in Finchley on the market with a lease of a little over 59 years outstanding. Freddie on an informal basis spoke with his freeholder being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Freddie to invoke his statutory right. Freddie procured expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
In 2014 we were contacted by Dr Harrison Nguyen who, having moved into a one bedroom flat in Finchley in May 2011. We are asked if we could estimate the price would be for a ninety year extension to my lease. Identical flats in Finchley with 100 year plus lease were valued around £265,200. The mid-range ground rent payable was £65 billed monthly. The lease ended in 2090. Having 66 years remaining we approximated the compensation to the landlord to extend the lease to be between £15,200 and £17,600 exclusive of costs.
An example of a Lease Extension case for a Finchley flat is Ground Floor 110 Station Road in June 2013. The Tribunal found that the premium payable for a lease extension should be £31,665. This case affected 1 flat. The number of years remaining on the existing lease(s) was 56.65 years.